Did you know that shipping cost is the most common reason for shopping cart abandonment?

In fact, according to research, 44% of buyers do not complete the purchase because getting the product to them is too expensive.

Moreover, shipping is often the first indication of a service quality. It doesn’t matter how useful your website is and the depth of information it provides. If the customer doesn’t get the product fast, they will consider your service as poor.

Types of Products

When deciding on a shipping carrier to use, the first thing you should take into consideration is the type of products you are selling and if you have any special requirements. Each carrier has different restrictions, so whilst one carrier may suit your product, another, cheaper carrier may not.

Not every provider will be able to ship your goods. Your products might be too big or require special handling which the shipping company may not be able to provide.

Reputable Carriers

Most of your customers will prefer to receiver their order from a shipping providers they’ve heard of. Neto integrates with all major Australian Shipping Carriers such as Australia Post eParcel, Startrack, Couriers Please, Couriers Please and Fastway are just a few.

Carrier Pick Up’s and Drop Off’s

When comparing shipping carriers, you will want to consider whether the carrier picks up the packages (and any related fees) for you, or if you need to transport the packages to the carrier’s drop-off location yourself. If you need to drop off packages, find out where the nearest drop-off location is, along with their hours of operation.

International Shipping

It’s always good to have the idea of global shipping in the back of you head. Did you know that Neto is the only eCommerce platform to integrate directly with Australia Post International, giving you the ability to generate customs documentation.

Offering more than one Carrier

Neto gives you the ability to pit multiple carriers against one another in the ultimate fight for your logistics business. Using a feature called Low Costing Routing, Neto allows you to calculate rates for multiple carriers, showing only the cheapest options based on service groupings of your choice. This can help you ship with the cheapest possible carrier for every product you send to your customers.

Shipping Carrier Pricing

Almost all Shipping Carriers charge freight based on:

The size of the shipment

The destination address

The service used (e.g.: Express or Standard)

It is important to negotiate the best possible freight rates with your carriers. If possible, try to secure a flat rate for particular carton or satchel sizes. You will find that different carriers offer different rates for different delivery locations.

It is therefore important to offer multiple carriers where possible. With Neto you can offer multiple carriers and multiple services to your customers, empowering the customer to make their own choice when it comes to how and when they receive their order.

Neto recently announced their partnership with Sendle - a carrier aggregator. It’s free to register and you have instant access to great rates without the need for individual carrier accounts or negotiations.

Size of Shipment

When it comes to the size of your products, different Shipping Carriers cater to different sizes.

Note: shipping carriers are very rarely one size fits all. Some carriers, such as TNT are better equipped for larger products. Some carriers, such as Australia Post, only allow parcels up to 22kg, suitable for smaller products.

Destination Address

Typically, the longer the haul, the higher the shipping price will be. Many shipping carriers only serve a specific geographic region so you must consider how many post codes a shipping carrier services directly.

In some cases, if a shipment is sent to a location outside a carrier’s normal service area, the Shipping Carrier will transfer the shipment to another shipping carrier for final delivery. This is called interlining, a practice that may result in higher costs due to lower discounts and higher minimum charges.

Pre-Paid and Pre-Negotiated Satchels

Freight carriers such as Australia Post, Australian Air Express and Couriers Please offer competitive rates for satchels of set weights. The satchels offer two advantages:

Lower fixed rate cost

Double as packaging, negating the need for additional packaging

Cubic Weight Modifiers

If you are selling large or bulky goods that typically cube out to larger weights, it is a good idea to negotiate your rates on the lowest possible cube or cubic weight modifier. The standard road cubic weight modifier is 250kg per cubic metre, meaning
that an item that is 1 cubic meter is equivalent to 250kg. By negotiating a lower cubic weight modifier such as 167kg per cubic metre you can drastically reduce your shipping costs.

The cubic weight calculation used by shipping carriers is:

Length (m) x Width (m) x Height (m) x Cubic Weight Modifier (kg)

Shipping carriers will usually base their charges on dead or cubic weight (whichever is higher).

Multiple Shipping Carriers

Different carriers offer different rates to different locations. This is due to each carrier having their own delivery network. Offering multiple shipping options not only empowers your customer to make their own decision as to when and how their order
will arrive, but can also be more cost effective both parties.

Pre-Made Packaging

Where possible, organise pre-made packaging of set sizes, and negotiate flat rate pricing for this packaging. This will help fix your freight costs. You can purchase packaging from suppliers such as Signet (http://www.signet.net.au) or find cheap packaging suppliers on eBay.

Shipping Scales

Shipping carriers will never adjust your freight costs down. If you pass incorrect weight values to the carrier and these values are heavier than the actual parcel weight you will be losing margin without even realising. Purchase a decent set of scales
from eBay or http://www.scaleshop.com.au and make sure they are calibrated regularly.

Round Down Weight

In cases where your parcel weight is only slightly over the round kilo mark (e.g.: 1.05 kg) make sure that you round down to 1kg. Freight carriers typically round up to the next kilo starting from just .01 over the last kilo.

Add a Packing Allowance

If you are charging for shipping using the cubic / weight based method it is good practice to add a packaging allowance of a few percentage points or grams to cover additional packaging. This can be done when setting up shipping methods and rates in Neto
and will increase the calculated order weight by the defined percentage or fixed amount.

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